You Are Considering Implementing a Lockbox System for Your Firm

question 110

Multiple Choice

You are considering implementing a lockbox system for your firm. The system is expected to reduce the collection time by 3 days. On an average day, your firm receives 680 cheques with an average value of $99 each. The daily interest rate on Treasury bills is.0125 %. The bank charge per cheque would be $.15. What is the anticipated daily savings if this system is implemented?

• A) $23.18
• B) $24.07
• C) $25.25
• D) $25.92
• E) $26.03

Grasp the concept and importance of control in an organization.

Recognize the significance of ethical behavior in accounting practices.

Comprehend different managerial accounting tools that aid in decision-making.

Understand the concepts of planning and continuous improvement in management.

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Definitions:

Lincoln

The 16th President of the United States, Abraham Lincoln, known for leading the country during the Civil War and abolishing slavery.

1860 Election

The presidential election in which Republican Abraham Lincoln defeated three other candidates, leading to the secession of Southern states.

Presidential Candidate

A person who is nominated or runs for election to the office of the President.

Southern States

Refers to the states located in the southern region of the United States, historically characterized by distinct cultural, economic, and historical traits.